This study compared spondee identification performance in presence of speech-shaped noise or two competing talkers across children with hearing loss and age-matched children with normal hearing. The results showed a greater masking effect for children with hearing loss compared to children with normal hearing for both masker conditions. However, the magnitude of this group difference was significantly larger for the two-talker compared to the speech-shaped noise masker. These results support the hypothesis that hearing loss influences children’s perceptual processing abilities